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WilliamK8 (North Carolina)
Posts: 10
Posted:
Our little 28-unit NC condo sub-board (a year overdue holding an election) finally held a meeting in December but instead of electing officers they rolled out a whopping $13K assessment covering siding, chimneys, staircases and lots more.

Thing is, when they posted the results they claimed it passed the 2/3 threshold with 9 votes out of 14 (we had 14 ppl at that meeting but the ballot went out by mail and was tallied weeks later, so shouldn't it be 2/3 of all owners not the number there on an arbitrary night where no vote was taken?

Even if using that quorum as a basis however, they reported getting 9 yes votes out of 14 - but 2/3 of 14 would mathematically require about 9.3 votes. Are they allowed to round down lol? Either way you look at it, they missed the mark of 2/3s, yet they are barreling ahead here, pretending to have secured the required number.

We also just discovered the company they're planning to hand those funds to -- is not licensed.

Help! And thanks.

JohnC46 (South Carolina)
Posts: 14,265
Posted:
William

Typically a Special Assessment would require 2/3rds of ALL OWNERS approving. Read your docs closer to be sure this is the case in your association. If so the BOD will need to conduct another vote.

People often confuse 2/3rds of ALL Owners with 2/3rds of owners at a meeting. Not the same thing unless all owners were at the meeting.
GeorgeS21 (Florida)
Posts: 3,808
Posted:
Was the special assessment noticed (on the agenda and with sufficient time for the notice) per your docs and statute?

As noted, it would rare indeed for special assessments to require 2/3 of attendees(assuming of course there was a quorum) - most special assessments require a super majority - usually 2/3.

Make sure you are correct, then write a formal letter outlining your concerns - including excerpts from your docs proving your point. Also note in the letter that the circumstances indicate an illegal vote and outcome which must be addressed by a legally noticed vote following the law and governing documents.
CathyA3 (Ohio)
Posts: 6,299
Posted:
Yes, when computing percentages for voting, you have to round up. If 2/3 is 9.2, then you need 10 - because 9 is less than 2/3.

Re: approval of special assessments - I don't believe all states require membership approval (mine doesn't). However, our lawmakers approached the issue from the other end, requiring annual reserve contributions according to the latest reserve study unless the majority of the membership approves a lower contribution (and this must be an annual approval).

Personally I'd be more concerned about hiring unlicensed contractors to do the work. Unlicensed may also mean they're not properly insured - I'd bet on it - and if one of them gets injured, your association and the homeowners personally will be in a world of hurt.

Fixing this is a lot of work, and you'll need help from your fellow owners.

* First, read your governing docs and applicable state laws thoroughly so that you understand how to replace board members. Do you have enough homeowners who are willing to serve on the board? If not, this is going nowhere.

* Hire a lawyer to legally challenge the vote. This is more expensive, and it doesn't solve the long-term problem of board members who don't know what they're doing and apparently don't want to know.

* Call a realtor and run for your life.
ShellieK1 (Arizona)
Posts: 1
Posted:
Wow, we have a Property Owner's Association in Arizona. The same thing happened in our association that has 194 lots.
This is a rural community with dirt roads with some gravel, around 9 miles of mountainous roads.
The only purpose of our POA is to maintain the roads per our contract which is called the Codes, Covenants and Restrictions, hence, CC&R's.
Well, what happen is the BOD decided to spend 15,000 thousand on water tanks. That is not in our charter. Yup, we have had a terrible fire season. They were not truthful about what the fire department chief said. The BOD said the Battalion Chief was very excited to have another source of water.
Is that not special...When I spoke with the Chief, he told me, WHY would we draft water from the 5,000 gallon water tanks in a brush fire. By the way, there are four 5,000 gallon water tanks. HA...HA, guess where they are.....Yup. on the BOD's properties. One behind a lock gate.
Within 3 miles, there are 7 fire hydrants. The Chief said the his fire department know what equipment to send out.

In essence, the BOD decided, without the 2/3 vote of the membership to do the same thing to our members.
Guess what, all of the BOD quit! The reason why is because they said our group was harassing them...Another big deal..the ex-president of the assoc. still has the checkbook, worked on the roads with his own grading company, signed the checks to his own company..Can anyone say "Conflict of Interest"
Anyway, the whole 10 BOD's resigned in October, 2020.
There was a call for volunteers. 3 folks stepped up that are not afraid of the repercussion of their (prior POA's) rant.

To get down on the nuts and bolts, the prior BOD will not turn over the bank account, post office box or records to (us) the volunteers, which are know the interim board, which are now the only 3 that sent in their ballots in a timely manner. . Is this not CRIMINAL....our POA attorney said to wait until the next election..how can we have an ELECTION when the prior board, that quit, are holding the entity's money, property and mail for no good reason. The post office froze our mail account due to fraudulent acts by the prior board member stating he is the president. We showed the post office all of their letters of resignation. They said, since the po box is in dispute, they will hold the mail until a judge orders the peior to give the entity it's mail. Same with the bank. WTF
AugustinD
Posts: 5,144
Posted:
Quote:
Posted By WilliamK8 on 01/28/2021 8:06 PM
Our little 28-unit NC condo sub-board (a year overdue holding an election) finally held a meeting in December but instead of electing officers they rolled out a whopping $13K assessment covering siding, chimneys, staircases and lots more.

Thing is, when they posted the results they claimed it passed the 2/3 threshold with 9 votes out of 14 (we had 14 ppl at that meeting but the ballot went out by mail and was tallied weeks later, so shouldn't it be 2/3 of all owners not the number there on an arbitrary night where no vote was taken?

Even if using that quorum as a basis however, they reported getting 9 yes votes out of 14 - but 2/3 of 14 would mathematically require about 9.3 votes. Are they allowed to round down lol? Either way you look at it, they missed the mark of 2/3s, yet they are barreling ahead here, pretending to have secured the required number.
-- WilliamK8, please quote verbatim exactly what your covenants say about special assessments and any vote required to approve them.

-- I do not see anything in the NC condo act requiring a vote as you describe.

-- Like CathyA3 posted, and as you suspect, yes, for issues like this, the number required is computed by rounding up to the nearest whole number.

-- Both the vote and the fact that an election was not run are both problematic as far as this special assessment is concerned.

-- A Special Assessment is usually a sign of poor planning by the boards over the years. I am betting its more likely than not that a special assessment is in fact needed.

-- In my experience, one's review of any recent reserve study recently done is critical to one's being intelligent in one's remarks on this special assessment.

-- Re the "company," much more elaboration is needed, starting with: For whom does this company work?

AugustinD
Posts: 5,144
Posted:
ShellieK1, start a new thread. Please indicate whether this is a condominium or a neighborhood of single family, stand alone, homes. Please quote exactly what your covenants say about special assessments. If possible, please quote exactly what Arizona statutes require regarding special assessments.
WilliamK8 (North Carolina)
Posts: 10
Posted:
-- WilliamK8, please quote verbatim exactly what your covenants say about special assessments and any vote required to approve them.

It does call for 2/3 of all owners (even our master board members (who are trying to stay OUT of this LOL bc our sub-Board Prez is suing them) plus every one else I've talked with immediately said the numbers don't add up, even if we used the Quorum as the base. He got 9 Yes votes out of 28 and is calling that 67% - and promising the next meeting in April (not an election mtg) but just to update on the Assessment Schedule) Did I mention he claimed out lender here stipulated that we suspend HOA elections for the life of the loan (or 5 years)

-- A Special Assessment is usually a sign of poor planning by the boards over the years. I am betting its more likely than not that a special assessment is in fact needed.

Very much - and according to neighbors, our current leadership is largely to blame (I just moved into this mess) so we need urgent work, which greases the wheels for a spectacularly shady deal. Ever heard of 750-sqft 1-br condos getting hit with a single assessment totaling over $13K to include siding, all windows (many not needed), all chimney rebuilt (most not needed), replace every staircase (many not needed) plus gutters, mailboxes & 4 or 5 smaller items - all going to a single company that keeps repeating out loud how often they've worked with our Prez at his other HOAs (he's president of 3 board and served on a 4th he repeatedly says - Who does that??

-- Re the "company," much more elaboration is needed, starting with: For whom does this company work?

They're unlicensed for jobs over $30K - this would be $350K. It was a misdemeanor for them just to bid, NCLBGC tells me. I do not know who they would technically be employed by, presumably our sub-board if theings were on the up and up.

put together this site to wake up my co-owners who are largely dormant. That's been the biggest hurdle of all, especially with off-site >>> https://isthisaccurate.weebly.com/
AugustinD
Posts: 5,144
Posted:
WilliamK8:

-- You feel the problem is the president and maybe a board majority. The owners have the legal power to remove directors.

-- If I were you, I would use the North Carolina Condominium Act section 47C-3-103 (b):

"Notwithstanding any provision of the declaration or bylaws to the contrary, the unit owners, by a majority vote of all persons present and entitled to vote at any meeting of the unit owners at which a quorum is present, may remove any member of the executive board with or without cause, other than members appointed by the declarant."

-- You should hire an attorney to assist you in removing your officers. In my experience, a layperson like yourself will not be able to do this alone.

-- North Carolina Condo Act and North Carolina Nonprofit Corp Act:

https://www.ncleg.net/EnactedLegislation/Statutes/PDF/ByChapter/Chapter_47C.pdf

https://www.ncleg.net/enactedlegislation/statutes/pdf/bychapter/chapter_55a.pdf
AugustinD
Posts: 5,144
Posted:
Quote:
Posted By AugustinD on 01/29/2021 8:10 AM

-- You should hire an attorney to assist you in removing your officers.
Correction: You should hire an attorney to assist you in removing your directors (not officers).
ChrisE8
Posts: 454
Posted:
A similar thing happened at a NC condo association where I owned a property. People vented about it but nobody actually took action. The easiest action to take is to remove the board at the next election.
WilliamK8 (North Carolina)
Posts: 10
Posted:
Quote:
Posted By ChrisE8 on 01/29/2021 9:54 AM
A similar thing happened at a NC condo association where I owned a property. People vented about it but nobody actually took action. The easiest action to take is to remove the board at the next election.

Many thanks for the helpful advice and the Condo statutes - which I was unaware of.

Guess the bigger issue here might be that enough owners are desperate enough, or apathetic/absent enough, or straight up clueless enough not to recognize the dangers of handing unlicensed contractors over a quarter of million dollars.

Highly doubtful we can force a vote because of that apathy - and if our Prez were to ever get around to holding a legit election, he might still get elected by virtue of little competition and folks not paying attention.
ChrisE8
Posts: 454
Posted:
Quote:
Posted By WilliamK8 on 01/30/2021 11:03 AM
Posted By ChrisE8 on 01/29/2021 9:54 AM
A similar thing happened at a NC condo association where I owned a property. People vented about it but nobody actually took action. The easiest action to take is to remove the board at the next election.


Many thanks for the helpful advice and the Condo statutes - which I was unaware of.

Guess the bigger issue here might be that enough owners are desperate enough, or apathetic/absent enough, or straight up clueless enough not to recognize the dangers of handing unlicensed contractors over a quarter of million dollars.

Highly doubtful we can force a vote because of that apathy - and if our Prez were to ever get around to holding a legit election, he might still get elected by virtue of little competition and folks not paying attention.

Calling a special meeting usually doesn't take more than a fraction of owners-sometimes 25% or so.

In my situation, there was no special meeting, but eventually an owner filed a lawsuit against the board president and the board president was not re-elected.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
William

How difficult can it be to communicate with all 28 owners? Why not produce a letter with your concerns and inviting Concerned Fellow Owners to an Open Discussion Meeting that you set up. Slip it under their door. Post is all over. This meeting cannot be stopped nor controlled by the BOD. Otherwise just keep complaining online to people outside your association for what little use it does.
WilliamK8 (North Carolina)
Posts: 10
Posted:
Quote:
Posted By JohnC46 on 01/30/2021 11:39 AM
William

How difficult can it be to communicate with all 28 owners? Why not produce a letter with your concerns and inviting Concerned Fellow Owners to an Open Discussion Meeting that you set up. Slip it under their door. Post is all over. This meeting cannot be stopped nor controlled by the BOD. Otherwise just keep complaining online to people outside your association for what little use it does.

Well it's proven quite difficult when most owners live off-site and even out of the country, and of course the BOD isn't exactly handing over their contact details are they? But we have been trying that.

And sorry to disagree, but listening to other people here has actually proven wildly helpful so far.
ChrisE8
Posts: 454
Posted:
Local real estate records should show owners' mailing addresses.

WilliamK8 (North Carolina)
Posts: 10
Posted:
Quote:
Posted By ChrisE8 on 01/30/2021 12:14 PM
Local real estate records should show owners' mailing addresses.


Thanks and we are on that now. We were told our meeting the last week in December would be an annual election, a year overdue. Yet no election was on the agenda, just the assessment. Immediately there after they promised an election for March, which yesterday was pushed back to April. We're only now coordinating for a special meeting - and the forum has been a big help. But in today's world, getting 10 scattered people to put their name and signature on a legal document of any kind is an uphill battle. But luckily the blatantness of our Prez's antics have been making that easier. We're up to 8 out 10 needed.
ChrisE8
Posts: 454
Posted:
From my own experience, using DocuSign and making the request for a meeting and proxy as simple as possible and as specific as possible are the ways to go.

Sounds like you're in great shape and I'm glad to see that you're standing up against a bad HOA.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Quote:
Posted By WilliamK8 on 01/30/2021 12:09 PM
Posted By JohnC46 on 01/30/2021 11:39 AM
William

How difficult can it be to communicate with all 28 owners? Why not produce a letter with your concerns and inviting Concerned Fellow Owners to an Open Discussion Meeting that you set up. Slip it under their door. Post is all over. This meeting cannot be stopped nor controlled by the BOD. Otherwise just keep complaining online to people outside your association for what little use it does.


Well it's proven quite difficult when most owners live off-site and even out of the country, and of course the BOD isn't exactly handing over their contact details are they? But we have been trying that.

And sorry to disagree, but listening to other people here has actually proven wildly helpful so far.

Good to see you are being pro-active. Read up on Proxies. Proper use of them can control an election.
AugustinD
Posts: 5,144
Posted:
-- Ditto what ChrisE8 and JohnC46 said, regarding the OP's progress and proxies.

-- From the NC Condo Act at ยง 47C-3-108. Meetings:
===
(a) A meeting of the association shall be held at least once each year. Special
meetings of the association may be called by the president, a majority of the executive
board, or by unit owners having twenty percent (20%) or any lower percentage specified
in the bylaws of the votes in the association. Not less than 10 nor more than 60 days in
advance of any meeting, the secretary or other officer specified in the bylaws shall cause
notice to be hand-delivered or sent prepaid by United States mail to the mailing address of
each unit or to any other mailing address designated in writing by the unit owner, or sent
by electronic means, including by electronic mail over the Internet, to an electronic mailing
address designated in writing by the unit owner. The notice of any meeting must state the
time and place of the meeting and the items on the agenda, including the general nature of
any proposed amendment to the declaration or bylaws, any budget changes, and any
proposal to remove a director or officer.
...
===

-- A bit more on calling Special Meetings appears at https://www.ncleg.net/EnactedLegislation/Statutes/PDF/ByChapter/Chapter_47C.pdf

-- WilliamK8, what, if anything, do the Bylaws state is the quorum requirement for a meeting of the membership?

-- If the Bylaws are silent on quorum, then the NC Condo Act says quorum is met as follows:
===
47C-3-109. Quorums.
(a) Unless the bylaws provide otherwise, a quorum is deemed present throughout any meeting of the association if persons entitled to cast twenty percent (20%) of the votes which may be cast for election of the executive board are present in person or by proxy at the beginning of the meeting.
...
===

-- The Act has a bit more on quorum. See the link above.

-- To repeat the Act at section 47C-3-103 (b): "Notwithstanding any provision of the declaration or bylaws to the contrary, the unit owners, by a majority vote of all persons present and entitled to vote at any meeting of the unit owners at which a quorum is present, may remove any member of the executive board with or without cause, other than members appointed by the declarant."

-- If per chance each of the 28 units has exactly one vote, then a mere six units can call for the Special Meeting. If all six unit attend the meeting in person or by proxy, and the Bylaws are silent on quorum, then quorum is met. If the Bylaws are silent on quorum, then a mere four units can toss out the directors.

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